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ELRCPartially AllowedCause 354 of 2009· [2012] KEELRC 62 (KLR)

John Kipkurui Cheruiyot V Equity Bank Limited [2012] KEELRC 62 (KLR)

Industrial Court of Kenya
2 November 2012
1,933 words in judgment
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The bottom line

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A Kenyan court ruled Equity Bank's dismissal was procedurally unfair, but the employee won only notice pay because he lacked evidence for his bigger claims.

What this practically means

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Executive summary

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The Claimant, formerly an Accounts Assistant employed by Equity Bank Limited on 1 March 2007 at a monthly salary of Kshs 60,000, claimed wrongful, discriminative and unlawful summary dismissal on 19 March 2009 without notice or hearing. He sought salary in lieu of notice, annual leave, salary arrears, gratuity and compensation for wrongful dismissal. The Respondent's Reply alleged the Claimant was involved in the theft of two bankers' cheques or refused to give information about the theft, but the Respondent did not participate in the hearing, lead testimony or make submissions; the cause was carried over after Justice Chemmutut ceased to be a judge before pronouncing an award, and the present judge elected to determine the claim on the pleadings. The court, Justice Radido Stephen, held that section 41 of the Employment Act, 2007 imposes a peremptory obligation on employers to notify and hear employees before termination, and that even summary dismissals under section 44 are subject to procedural fairness. As the pleadings could not establish that the Claimant was notified and heard, and the Respondent offered no proof of compliance, the dismissal was found wanting in procedural fairness. The court awarded one month's salary in lieu of notice (Kshs 60,000) and earned salary for days worked up to 19 March 2009, but declined annual leave pay, salary arrears, gratuity, reinstatement and compensation under section 49 for want of evidentiary basis or exceptional circumstances. There was no order as to costs.

Key legal issues

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01

Whether the summary dismissal of the Claimant was procedurally fair

Holding

The dismissal lacked procedural fairness; it could not be determined from the pleadings that the Claimant was notified and heard before dismissal, and the Respondent did not participate in the case to prove compliance.

Reasoning

The dismissal letter implied that the Claimant had been suspended, investigated and found to have given unsatisfactory explanations, but the pleadings did not expressly establish that he was notified of the charges and given a hearing. The Respondent merely filed a general denial, led no testimony and made no submissions, leaving the Court no alternative but to find the dismissal wanting in procedural fairness contrary to section 41 of the Employment Act, 2007.

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02

Appropriate remedies for the unfair dismissal

Holding

One month's salary in lieu of notice (Kshs 60,000/-) and earned salary up to 19 March 2009 awarded; annual leave, salary arrears, gratuity, reinstatement and compensation under section 49 all declined for want of evidentiary basis or exceptional circumstances.

Reasoning

The notice claim followed logically from the finding of procedural unfairness. The other heads failed because the Claimant pleaded no evidentiary or contractual/legal basis for leave pay, arrears or gratuity. Reinstatement was inappropriate given the trust-based banking sector and the Respondent's lost faith, and the material did not permit an award of compensation under section 49.

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Legal principles established

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  • Section 41 of the Employment Act, 2007 creates a statutory obligation on employers to notify and hear employees before terminating employment, and even summary dismissals under section 44 are subject to procedural fairness under section 41.
  • Procedural fairness alone is insufficient; an employer must also prove the validity and fairness of the reasons for termination (substantive fairness) under sections 45 and 46 of the Employment Act.
  • Reinstatement, though statutorily available, is an exceptional remedy akin to specific performance.

Court orders

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  1. 1.Award of one month's salary in lieu of notice in the sum of Kshs 60,000/-
  2. 2.Award of earned salary for days worked in March 2009
  3. 3.All other prayers declined
  4. 4.No order as to costs

Authorities

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Legislation

  • Industrial Court (Procedure) Rules, 2010rule 4(e)
  • Employment Act, 2007sections 41, 44, 45, 46, 49

Cases cited (2)

  • Gilbert Nyabuto Mosome v The Standard Limited
    Industrial Court Cause No. 697 N of 2009
  • Jorum Gakumo v Thika Coffee Mills Ltd
    Industrial Court Cause No. 693 of 2012
Jurisdiction invoked
Jurisdiction of the Industrial Court over employment and labour disputes (the Cause was filed as Cause 354 of 2009 under the Industrial Court's jurisdiction); no specific constitutional provision invoked.

Key timeline

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Practical implications

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Frequently asked questions

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Cite this brief

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Cite this brief

Caselaw, "John Kipkurui Cheruiyot V Equity Bank Limited [2012] KEELRC 62 (KLR)", Case Analysis (2012). Cause 354 of 2009. Source: https://new.kenyalaw.org/akn/ke/judgment/keelrc/2012/62/eng@2012-11-02

Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.